The advent of mobile communications devices (MCDs) such as cellular telephones has enabled telecommunication in a wide variety of environments previously not contemplated. MCDs have decreased in cost to become more common than conventional land-line telephones. Thus, the MCD is commonly seen in stores, malls, public squares, sporting events, and has become ubiquitous.
MCDs have also evolved to host somewhat related technologies, such as digital cameras, scanners, text messaging, and computer supported internet browsing and email access, for example. All these nascent technologies have thus become available to users in a variety of conventional day-to-day environments. Some have contemplated applications for use of mobile phones in a commercial environment, including effectuating commercial transactions; however, most of these concepts require additional hardware and/or software for the consumer and/or the merchant.
In Japan, some mobile phones now include computer software that enables the telephone to capture and read quick response (QR) matrix codes. This computer software may be bundled with the phone, programmed into the phone by the customer, or purchased as third party commercial software. An individual may then use the mobile phone to take a picture of or capture the QR code, decode it, and transmit the code and user's digital information to a remote system as a request for marketing materials to be sent to the user. This is primarily a one-way or uni-directional transaction with respect to digital information and does not extend beyond the registration of the request and the response of providing the marketing materials to the potential consumer; there is currently no provision for a payment system. QR matrix codes are also used in inventory management, transportation, etc., subject to a Japanese industry standard. Denso Wave, Inc., of Tokyo, Japan, is a commercial provider of software using the QR codes, and more information may be found at http://www.denso-wave.com/qrcode/app-prod-e.html.
PayPal™ mobile is a one-way text-only payment system commercially available through Paypal of San Jose, Calif., and is capable of being hosted on mobile phones. A user may send a text message from their MCD designating a monetary amount and requesting a transaction with another party, using their telephone number or email account. Along with the monetary amount and designated type of transaction, the user must provide a personal identification number for confirmation of the transaction. As noted above, the PayPal™ mobile system is uni-directional, text-only and does not use graphic images to convey data about a transaction. Upon submission of a transaction request, a PayPal operator will call the user to confirm the transaction. Thus, this system is not real-time or completely automated
(see https://www.paypal.com/cgibin/webscr?cmd=xpt/cps/mobile/MobileOverview-outside).
Obopay™ is a mobile phone system, offered commercially by Obopay, Inc. of Redwood City, Calif., that enables certain transactions using money held in an “Obopay account” at a bank designated by Obopay™. The transactions include sending or receiving money between Obopay accounts and management of an Obopay™ Prepaid MasterCard®. The system generally relies on proprietary software for full functionality; the proprietary Obopay™ software must be installed on the mobile phone, making it inaccessible or difficult for most users, and some mobile phones do not support the technology. The Obopay™ system can also use SMS (“Short Messaging Service” or “Simple Messaging Service”) messaging or mobile phone internet access; however, users without the Obopay™ software must use web access (i.e., wap.obopay.com) from their mobile phone or non-graphic SMS text messaging. Commercial transactions are contemplated as relying on use of the prepaid credit card and not by direct mobile phone communication.
Other proposals have contemplated including the mobile phone in steps such as scanning bar codes (e.g., the universal product code), generating bar codes, decoding bar codes, communicating with merchant hosted communication systems (e.g., blue tooth, infra red), etc. A common drawback with these proposals is the requirement for additional hardware and/or software for the consumer's mobile phone and/or the merchant's point of sale (POS) technology. For example, conventional (i.e., off the shelf) mobile phones may be able to photograph and capture images, but they currently are unable to scan and decode universal product codes. Further, some of these systems require multiple interfaces that complicate the digital information flow. Of course, such requirements would complicate implementation and slow the development of a standard system.
Unfortunately, there is not available a secure, global, two-way payment system that relies on off-the-shelf mobile phones, is capable of accepting either graphics or text to complete a transaction, does not require additional software and/or hardware to be loaded onto the mobile phone or the merchant's POS technology, does not require a secure network, provides for out-of-channel two-factor authentication of the transaction by the consumer and does not require the merchant to receive payment directly from the customer at the point of purchase.
By providing such a system and method, the present invention thereby benefits a variety of entities including, for example, online digital content publishing/sales entities, offline unattended kiosks, and offline small-to-medium sized entities (SMEs) where real-time credit card authentication is not practical for the merchant.
The present invention is a distributed system and method for handling payment in commercial transactions. The present invention uses existing, common technologies already in widespread, global use to implement a bi-directional flow of digital information to enable commercial transactions. Further, the present invention does not require additional software/hardware to be installed on user's mobile telephones.
Of course, a two-way system supporting bi-directional transactions will present security challenges greater than the single-way systems. The configuration of the present invention preferentially provides a secure two way flow of information. Two-factor authentication (originating cell phone and personal identification number (PIN)), for example, may provide consumer fraud protection greater than or equal to Verified-by-Visa or MasterCard SPA, while maintaining an easily used interface for the mobile phone user, making it ideal for teens and young adults.
In one aspect, the present invention provides a distributed payment system that relies on the mobile phone keypad, the mobile phone camera, and SMS messaging technology. This system enables payment, online or offline, for transactions with minimal key entry on the mobile phone keypad by using the camera phone and SMS capabilities, respectively, to capture and transmit images of bar codes displayed by the vendor. The transaction is communicated using globally-accepted, consistent technologies and protocols, which renders the payment system independent of the mobile phone carrier and accessible to global consumers. The payment system can be accepted by merchants anywhere in the world that mobile camera phones are used, or any environment having Internet connectivity. The payment system travels over common, non-premium wireless protocols, providing the basis for the low-cost transactions critical for micro- and small-payment support, as well as for rapid merchant adoption. While the present invention does not require it, the present invention can operate with MCDs that implement additional or substitute software and hardware functionality, such as, for example, barcode scanning technology. In such an embodiment, the MCD can scan codes from paper or electronic interfaces in order to acquire the code for later processing as detailed herein or, where acceptable capture of the bar-code is problematic, accept text entry of the alphanumeric universal product code.